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Snow and flooding slows start of retail season

BOULDER, CO (BRAIN) — Snow in the Northeast and the Rockies—even in Phoenix—along with rain and flooding in the Midwest have created late-winter challenges for bike retailers and their suppliers.

Cycling-crazy Boulder has received 48 inches of snow so far in April, breaking a record set in 1957. While the early part of the winter was dry, the late snows have brought sales to a halt, said Brandon Dwight, owner of the two-store Boulder Cycle Sport chain.

"The weather is killing us. Nobody is out riding," Dwight said Tuesday. "We've been lucky the weekends have been fairly mild so people have been getting out, but during the week nobody has been coming in for test rides or to pick up an energy bar and an inner tube, and that hurts."

March was particularly difficult compared with last year, when Colorado riders enjoyed sunshine and 70-degree-plus days, Dwight said.

The Northeast has had a similar pattern, with a warm start to the winter followed by a tough March and April. Charlie McCorkell, owner of New York City's Bicycle Habitat chain, said a few warm and sunny days recently have made him optimistic about the rest of the season.

'We are farmers.' — NBDA's Fred Clements

"I'm very optimistic about it. I think every time the sun has shone, we've done really, really well. We're getting absolutely killed on days of sunshine and over 55 degrees. [Wednesday] is supposed to be 75, and if we get that through the weekend, we'll have a really good end of April," he said.

Besides the weather, retailers have other concerns this year. Major new product introductions are on the way in the high-end road market, with SRAM adding an 11th cog to its Red group and introducing hydraulic disc and rim brake options. Shimano is also widely expected to release an updated Ultegra group soon, along with road disc options.

McCorkell said the expected upcoming changes have contributed to a soft market for high-end road bikes.

"That's gonna knock down everything in the $4,000 range. People are going to watch and wait to see what is coming," he said.

The poor selling conditions in many parts of the country have contributed to high inventory levels at retail and wholesale levels. As a result, some vendors are offering promotions to move inventory before the 2014 model year bikes begin arriving, as early as next month.

Raleigh, Specialized and Trek have all offered promotions on high-end carbon road models. A Specialized promotion, originally set to end Sunday, has been extended through the end of May. And Specialized added a new bike to the promotion: the (10-speed) SRAM-Red equipped Tarmac Pro.

NBDA president Fred Clements said he has heard of retailers who say sales are off 60 percent this year compared with last. That's a problematic comparison because 2012 had an unusually warm first quarter in most U.S. regions.

"When you are off by 60 percent, that is scary. Even though this year may be comparable to previous years, it looks really bad compared to last year," he said. By most accounts, last year's sales were simply shifted earlier in the year and most retailers finished the year off within single digits of 2011, Clements said.

"We are farmers," Clements said, referring to bike retail. "We plant seeds by buying inventory, and then we hope for sun to make it grow. We live or die by the weather."